Can Apple’s AI Power Its $7 Billion Goal? A Look at What’s Driving Advertising Success

Apple is following in the footsteps of Google and Meta by experimenting with a new artificial intelligence advertising method. This approach, similar to Google’s Performance Max and Meta’s Advantage+, aims to automate ad placement, freeing up optimizers’ time, enhancing the reach and effectiveness of Apple ads, and reasonably reducing the cost per installation. Although currently limited to display positions within the App Store, it logically suggests that this tool could expand to other products.

The App Store is a global platform, attracting over 650 million users each week, providing businesses with the opportunity to reach their audiences. Over the years, users have viewed it as a safe and reliable platform, and through its ads, it helps users discover and download various applications.

Apple is testing an AI advertising platform, aiming to achieve $7 billion in advertising revenue

Apple’s new tool is not a groundbreaking invention in the advertising field, but it might be somewhat surprising for Apple to launch a similar tool since there are currently only a few types of ads. In the App Store, developers can pay to appear in various locations such as the “Today” tab, the search tab, and at the top of search results. In the early stages, Apple attempted to sell ads in the News app and the Stocks app, and it also introduced ads in Maps, Apple TV+, and its Books app. Recently, a sports app was launched, which could become another competitor for new ad placements. It is believed that over time, Apple may introduce more App Store search ad placements and expand ads to other apps, making the AI placement tool increasingly important.

Currently, Apple’s ad formats are mainly concentrated on the search tab and search results page. Once the new smart placement platform is launched, advertisers will be able to input their budget, cost-per-conversion goals, and target audience and regions, and Apple’s algorithms will automatically decide the best places to place the ads. Although Apple has not officially launched this product, insiders reveal that the company expects to roll it out in the coming months.

Analysts and investors indicate that Apple’s advertising business is expected to generate up to $7 billion in revenue this year, an increase of $1 billion from last year. While Apple has made progress in other areas, most of the revenue still comes from App Store search ads. Apple has also integrated ads in other areas, such as sponsoring and advertising during Major League Soccer matches on Apple TV. These signs suggest that Apple may have larger advertising ambitions and might introduce ads on platforms like Apple TV+ to compete with rivals such as Netflix.

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